For the Dutch version, click here. As secretary, my responsibilities include taking minutes at meetings, the association’s incoming and outgoing communications and annual planning. In addition, I have organized the Audit Activity and coordinate the StudyTour and Faces Online committees. In this article I share how I have experienced my year as secretary of Asset | Accounting & Finance so far, what challenges I still see for my final months and why I made the decision to do a board year last year! Who am I? I am Lars van Maris, 21 years old and currently a 4th year Bachelor Economics & Business Economics student. In my free time I like to play field hockey, or sit outside somewhere quiet to read. After I finished my VWO in Eindhoven, Tilburg seemed like a nice city to study, and when I found a room in Tilburg 2 weeks before TOP-week I started to build my own place. My choice for Asset | Accounting & Finance During TOP week, like many before me, I walked past the tables of Asset and then joined them. Unlike others in my TOP group, I did not then become active in a department. I did join Vidar then, and it is here that I met someone who later told me about the Accounting & Finance Department. Besides planning to study Finance myself after my bachelor’s, the activities and events I heard about also seemed very nice to me, so then I contacted the then Vice-Chairman to become active. The reason I finally decided to put myself in as secretary for a year When I started college, I already knew that I would not or did not want to run nominally with my studies. Your student time is a period in your life where you can learn so much that I knew very quickly that I wanted to make the most of it. Besides, it also looks very good on your resume if you have done some things besides your studies. So from year one I became active at Vidar and SHOT, and about two years later also at Asset | Accounting & Finance. Within Vidar and SHOT I had already come into contact with people who did or had done a year in those associations, and after talking to them about this I thought it would be a very valuable addition to my time as a student. As I learned more about what each position does within A&F and talked to then directors about serving on boards in general, it quickly became clear to me that the secretary position would suit me best. This is where my orderliness really comes into its own and where I can learn the most from everyone else. “What do you do as Secretary on the Board and why are you always so busy?” As Secretary, of course you have the classic tasks such as taking minutes of the meetings and managing incoming and outgoing communication via email, for example. In addition, as Secretary I am responsible for 2 committees, namely the StudyTour committee and the Faces Online Committee. Also, together with our Vice-chairman Julia, I am currently responsible for maintaining our website and the events and activities we have on it. Other than that, I don’t really have very big tasks anymore, but so this does mean that I have the time to take on some more of the smaller tasks that are left between us from time to time. I also continue to play field hockey actively at SHOT during my board year and I still have to work quite often on the weekends. This all together ensures that I generally have a nice full schedule. “So what kind of ‘smaller’ tasks do you have?” One of the most common smaller tasks on the board in designing promotion and social media. For this we generally use the design programs Indesign or Canva. Throughout the year, I have used these to create promotional materials for such events as the StudyTour, Faces Online, and several other events and activities. I also occasionally take over other small tasks from other board members when they don’t have time for this, such as drafting a message for our group app or an email. I also sometimes went with the externs to the meetings with our partners during the summer to support them here and take notes of the discussions. Picking up all these small tasks gave me the opportunity to learn a lot of new things and to be able to watch and learn from many different aspects of our board. “I wouldn’t have missed this for anything and I have absolutely no regrets about my choice.” Faces Online was in the beginning a task I often spent all morning with on Wednesdays but over the months I have learned to handle this much faster and more agile and learned a lot about and from this. As Secretary, I am also responsible for the StudyTour, and although this is one of the busiest and largest committees in all of A&F, I am very happy that it falls under my position. The committee is great to work with and the satisfaction that will soon be there when we have successfully put on and completed this event is something that makes all that effort more than worth it. In addition, I have had the opportunity to attend events and activities that you can hardly find anywhere else and partly through the events and activities I have been able to greatly expand my network. “What moments will you never forget from your board year?” The first moments that will stay with me forever are the night I was told who I was going to form a board with, and the first board weekend we all went to. On both occasions I got to know the rest of my board better than the entire time before that in which I already knew them. On the weekend we
Is there any perspective on the housing market?
For the Dutch version, click here. Buying a home, that sounds like Chinese to many students. It sounds like an impossible task, and more than 80% of students think the housing market is doing very poorly. Is the housing market really that bad, or are there opportunities after all? In this article, we will take a look at the housing market situation for recent graduates. Impact Duo First, student debt plays a role in monthly costs. This has an impact on the maximum mortgage you can get. When student debt is accumulated under the current loan system, mortgage lenders assume a weighting factor of 0.35%. This means that 0.35% of the study debt is assumed to be repaid monthly. In concrete terms, this means that if you borrow €1000 per month for 4 years, and thus have accumulated a total student debt of €48,000, your monthly costs for the student debt will be €168 per month. So this cannot then be spent on living expenses, and will be deducted from the maximum mortgage you can get. If you fall under the old pre-2015 system and received a basic scholarship, a weighting factor of 0.65% is used because the study debt must be repaid in 15 years instead of 40 years. Students who fall under both systems can choose which repayment period they take, and depending on that, the weighting factor is determined. However, during the initial phase of repaying student debt, mortgage lenders default to the 15-year repayment term for this group, resulting in a lower maximum mortgage. Duo does indicate for this that a statement can be submitted confirming the choice of repayment term in state, which should remedy this problem. The average student debt is around €16,500 for all students. The debt for people between the ages of 25 and 30 averages €20,300. Income Another essential factor for the maximum mortgage amount is income. The average starting salary after completing a WO master’s degree is around €2,500-€3000 gross per month. One year after completing the Master Finance, the average salary is €3,166. for the Master Accountancy, the average salary one year after graduation is €2,770. Mortgage Take the scenario that you complete the Master’s in Finance. After one year, you earn the average salary and have a permanent contract. You have a study debt of €20,300 under the new system, and you have no other outstanding debts. As a single person, you apply for a mortgage. The maximum mortgage you can get with these details is around €150,000. This is a 30-year annuity mortgage with 4.02% interest with a 20-year fixed-rate period. You will then pay €535 per month. The current housing market Is it possible to buy a starter home if you can borrow a maximum of €150,000? If you would like to buy a house in or around Tilburg, the cheapest houses start at prices around two tons. So without a personal contribution, it is already impossible to buy a house in this situation. A minimum contribution of €50,000 is needed, excluding the buyer’s costs. Housing market development Is there perhaps more perspective in the near future? The Nederlandsche Bank and ABN AMRO expect house prices to fall by 6% in 2023. Rabobank and ING expect a 3% decline on average. A further decline is also expected in 2024. The causes are mainly high mortgage interest rates and lower disposable income due to inflation. A rise in mortgage interest rates obviously also affects the affordability of owner-occupied homes. A further increase in mortgage interest rates will reduce house prices, but this is due to lower affordability from the demand side. Adding to this are ongoing problems in the construction industry, which means that new home construction continues to lag behind demand. There is no imminent improvement in this area. So in the short term, the housing market does not seem to be developing more positively, especially for first-time buyers. Conclusion So it is quite a job for the average recent graduate to secure a house to buy. With only a mortgage, this is virtually impossible. Nor is this going to get much better in the short term. That the majority of students think the housing market is doing badly is justified. Without accumulated wealth, or wealthy parents willing to step in, it looks like a mission impossible.
Working at HLB Witlox Van den Boomen – by Floortje Schroeder
For the Dutch version, click here. Started as a Junior Assistant Accountant at HLB Witlox Van den Boomen in 2016 and never left. How did I end up at HLB Witlox Van den Boomen and what is the reason I stayed after my internship? I am happy to tell you all about it in my story ‘Working At HLB Witlox Van den Boomen’. Who is Floortje Schroeder? First of all, let me introduce myself to you. My name is Floortje Schroeder and I am 25 years old. I was born in Tilburg but have been living in ‘s-Hertogenbosch for 13 years now. I remember very well that during high school I had a guest lecture by an accountant. This caught my attention so after high school I started the HBO course Business Economics/Accountancy at the Avans Hogeschool in ‘s-Hertogenbosch. I completed this course in 2018. I was born and raised in Tilburg, which is why I wanted to study in the city I come from. I then chose to take the pre-master’s degree in Accountancy at Tilburg University. After obtaining the pre-master’s I started the master’s in Accountancy and as of September 2020 I started the post-master’s in Accountancy at Tilburg University. I am now in the third and final year of the post-master Accountancy. My path to HLB Witlox Van den Boomen My path to HLB Witlox Van den Boomen started in 2016. In that year, I signed myself up for the practical route that was offered at Avans University of Applied Sciences at the time. The practice route is a route that gives students the opportunity to get acquainted with practice for 1.5 years. When participating in this practical route, students must choose an accounting firm where the choices included a Big4 firm and HLB Witlox Van den Boomen. My preference went to HLB Witlox Van den Boomen and my choice at the time was substantiated by the fact that I considered myself to fit better within a ‘smaller’ organization where the lines of communication are short, there are sufficient career opportunities, there is close (multidisciplinary) cooperation, an informal atmosphere and a client portfolio that is very diverse. The practical route brought me to HLB Witlox Van den Boomen in 2016 as a Junior Assistant Accountant where I could get acquainted with the practice for 1.5 years 4 days a week. Following the practical route at HLB Witlox Van den Boomen gave me the opportunity as a student to get an idea of how things work in practice and what activities an assistant accountant performs. Besides contributing to the expansion of my practical knowledge, this period has also contributed to my personal development and made it easier for me to make my choices regarding my follow-up studies. Practice versus theory I completed my HBO education in 2018 and after this I immediately started the pre-master and master Accountancy at Tilburg University. During this period, I returned to HLB Witlox Van den Boomen as an Audit work-study student. Because of my positive experiences during the practical work placement, I wanted to continue to expand my practical knowledge and also continue to develop myself during my studies at Tilburg University. As a work-study student you are part of the team just like all the other colleagues and you carry out activities that correspond to those of an assistant accountant. This work mainly involves performing audit assignments for various clients, where we gain insight into the client, processes and risks and, based on this, create our approach to the audit of the financial statements. The only difference between an assistant accountant and work-study student is that as a work-study student, you are likely to work fewer days. As a working student, you can decide how many days you want to work in addition to your studies and can reduce the number of days in busier periods and increase them in quieter periods. This gives you the opportunity to gain practical knowledge on a flexible basis, learn to apply the knowledge from school and go through personal development. After completing my master’s degree in Accountancy, I started working as an assistant accountant at HLB Witlox Van den Boomen. HLB Witlox Van den Boomen gave me the opportunity during both my HBO education and my master’s to gain practical experience and to develop myself personally. Because of this, my decision to start as an assistant accountant at HLB Witlox Van den Boomen was quickly made. Why did I never leave after my internship? Of course I thought about taking a look at another accounting firm. But working at HLB Witlox Van den Boomen gave me more and more feeling for the motto: ‘Never change a winning team’. I’ll explain why. Now that I have been working at HLB Witlox Van den Boomen for a number of years, I have come to realize that my considerations at the time of choosing an accounting organization for the practice route internship correspond with the practice. I was looking for a firm where the lines are short, there are sufficient opportunities for advancement, there is close (multidisciplinary) cooperation, an informal atmosphere and a client portfolio that is very diverse. My client portfolio is very diverse and ranges from Retail companies and manufacturing companies to property developers. This diversity ensures that I get to take a look behind the scenes at all types of companies. This keeps my work diverse and challenging. In addition, every year I have influence on my client portfolio because I can indicate which clients I like to work for the most! The advantage of working with our clients is that you often sit at the table with the entrepreneur himself and therefore the relevance of your work is immediately tangible. I work in Rosmalen and our audit department consists of about 30/35 colleagues. This ensures close cooperation on a daily basis, as well as sufficient room to take and receive responsibilities, and to grow and develop. Because of the close cooperation, there
Finance Expedition 2022: Looking back
For the Dutch version, click here. After 2 years when we had to organize the Finance Expedition online because of Covid-19, this year it was finally time again. On November 7 we left for Amsterdam again for the Finance Expedition. Over a period of 3 days, 24 students visit 2 companies each day within a particular pillar of Finance. This event is organized by Asset|Accounting & Finance in cooperation with Asset|Econometrics Ready with all the goodie-bags, suitcases and healthy excitement, the committee was waiting at the back of the station. Gradually the students arrived and well on time we left, in the beautiful Willem II bus, for Amsterdam! Once we arrived at the Holiday Inn on the Zuid-as, there was, after everyone had quietly gone to their rooms, the opportunity for the enthusiasts to have a drink in the bar to get to know each other better. Unfortunately, we had to go to bed fairly early because the wake-up call was set for 7 o’clock. Day 1 On Tuesday, November 8, we visited BDO and Oaklins, both specializing in the Mergers and Acquisitions branch within Corporate Finance. First up in the morning was BDO. Upon arrival at the office we were welcomed by the staff and were immediately pampered with coffee, tea and a little sweet. The program started with a short introduction about BDO and the opportunities that students have within BDO. After this, we were given a case in which we, as BDO employees within the Due Diligence process, had to determine the EBITDA (Earnings Before Interest Taxes Depreciation Amortization) of a sizeable company as best we could. At the conclusion, each group had to present their thought process and final EBITDA. The morning ended with a delicious lunch that presented the opportunity to personally interact with BDO employees. After lunch we had to quickly move on to Oaklins. Thanks to a grumpy bus driver who didn’t want to wait 10 seconds for us, we arrived at Oaklins 5 minutes late. Fortunately, no problem. Again we were welcomed with coffee and tea at Oaklins and after a short presentation about Oaklins as a company we started the 2nd case of the day. In this case, we as participants had to advise some employees of Oaklins whether or not they should take over a company in the travel industry. For this, we were given an extensive information memorandum and the opportunity to speak with both the “CEO of the company” and an “industry expert”. We had 1.5 hours to arrive at our advice. After a presentation in which everyone pitched their advice, it was time for dinner. Oaklins had arranged sushi and after dinner took us to ‘De Blauwe Engel’, a cafe on the Zuid-as where we enjoyed a small drink with some of the employees. Day 2 On Wednesday, November 9, as usual the alarm clock went off at 7 a.m. and this time we visited ING and a.s.r., this day was all about Asset Management. Arriving at the ING headquarters at the Bijlmer, we were given an introductory presentation on the future and vision of ING as a bank mainly within the Netherlands. ING discussed the case in the whole group and it consisted of analyzing a loan process that ING had provided to a transporter of fresh vegetables. We discussed the case with 2 employees who actually participated in this process and we covered the whole loan process, from initial application to, unfortunately, eventual bankruptcy. After the case, we also got a presentation from the CIO (Chief Investment Officer) of ING, he explained to us how portfolios are selected and built. After all the very interesting presentations, we unfortunately had very little time for lunch that ING had arranged. Although we had to eat quickly, it was again very tasty and in no time we were on our way to a.s.r. in Utrecht “The event was created to give students a bridge between theory from undergraduate school, what companies are actually doing with that knowledge and how it is applied.” Arriving at a.s.r., most people noticed one thing: how big the office is! Truly a huge, and beautiful office with a lot of glass allowing a lot of natural light to enter. During the introductory presentation we were shown the rich history of a.s.r. as an insurer. Also discussed was their recent acquisition and future vision of Aegon. After a short coffee break, it was time for the case. We were divided into groups and were given the task to even-out a.s.r.’s balance sheet during a variety of times of economic uncertainty. A news event was shown affecting an asset and/or liability and it was up to us to manage our insurance, equity and real estate portfolio in such a way that we as a.s.r. continued to make a profit. I thought it was a very original case as it combined Asset Management in the setting of a trading game often played at Market Makers at in-house days. After the case, it was time for drinks and pizza! Day 3 The last day had arrived and once again we were out of bed early! Thursday, November 10 was all about Risk Management, we visited RiskQuest in the morning and Deloitte in the afternoon. Arriving in the beautiful canals of Amsterdam, the relatively small office of RiskQuest was located in a beautiful canal house. After an introductory presentation, we were given a short tour of the office. The highlight was the office of one of the partners. In the ceiling of his office were several beautiful paintings from the time of Rembrandt, together with the beautiful view over the Amsterdam canals and the enormously comfortable office chairs. I am amazed that people still get work done! During the case, we were divided into groups and pretended to be employees of RiskQuest hired by a Luxembourg bank to recalibrate their Probability of Default Model. We then had to present our findings and a new credit risk model.
Hedging against inflation, is it possible?
For Dutch, click here. Current inflation has not escaped anyone’s notice, and among students there is great concern about its height. The first estimate from CBS indicates that inflation in the Netherlands in October was 16.8% based on preliminary figures. This is a slight decrease from September’s inflation rate of 17.1%. Nevertheless, this is an exorbitantly high rate, and assets are going up in smoke. Current inflation The average student, of course, does not have a large amount of assets. The price increases will therefore most likely lead to a higher debt with DUO for a number of students, and in addition, the interest rate on the debt has risen to 0.46%. Inflation is driven by factors beyond an individual’s control. Still, there may be other ways to combat inflation. Some popular ways to preserve purchasing power are examined in this article. Perhaps there are some ways to allay concerns. Gold Holding gold is seen by many investors as a good hedge against inflation. For example, Peter Schiff said “gold will shine in an inflationary environment.” To see if gold is indeed a good way to preserve value, we will look at the results of a few scholarly articles. Ghosh et al. (2004) examined whether gold is an effective inflation hedge. Through an empirical analysis, the article reveals that over a long time horizon gold can indeed act as a hedge against inflation. However, the nominal price of gold is dominated by short-term influences. So over a short time horizon, it can be very detrimental to invest in gold. For example, an investor who would have invested in gold in January in 1982 and held it through December 1999 would have lost 59% in real value. Beckmann and Czudaj (2013) reach the same conclusion in their study that gold can partially hedge inflation in the long run. In particular, consumer prices can be hedged in the long run by investing in gold. In the short term, however, it is not possible for an investor to hedge a portfolio against inflation by investing in gold. The characteristics of an economy during a given period mainly determine how gold responds to inflation. However, the scientific research by Hoang et al. (2016) indicates that gold is not a hedge against inflation in the long run. In the United Kingdom, the United States and India, gold does form a hedge against inflation in the short term. The contradictory result of this article compared to the other articles can be explained by the introduction of nonlinearity. This article proves that the relationship between gold and inflation is not a linear one in a number of countries. For example, a nonlinear relationship is visible in more developed countries, and a linear relationship is visible in developing countries. Thus, gold might be better used with the goal of building a more diversified portfolio. Based on the results of academic articles, I would advise against using gold as a hedge against inflation. The results are contradictory. Moreover, some articles do argue that gold can be used as an inflation hedge in the long run, but this requires a very long time horizon. Real Estate Another way often mentioned to combat inflation is to invest in real estate. An accessible way to invest in this is through a Real Estate Investment Trust (REIT). This is a company that owns real estate and generates income on it. Thus, by purchasing a REIT, it is possible to invest in real estate indirectly. Rubens et al. (1989) examined how a number of portfolios consisting of, among other things, different real estate types fared with respect to inflation. Each portfolio formed at least a partial hedge against inflation when it came to expected inflation. When inflation was unexpected, all portfolios formed no hedge against inflation. Thus, the type of inflation largely determines whether real estate can be used against inflation. Current inflation is high, and it is expected to remain high in the short term. Currently, therefore, real estate could be a way to hedge against inflation provided the expected inflation is similar to the eventual actual inflation. The portfolio consisting of financial assets and residential real estate from the article has the highest Sharpe ratio. Thus, with current expected inflation, it would be most attractive to invest in a REIT that focuses on residential real estate. Another scholarly article by Park et al. (1989) focuses specifically on hedging inflation through REITs. Equities typically perform poorly during times of high inflation. Although REITs have real estate income as an underlying asset, it could be that, like stocks, they still do poorly when there is high inflation. The study finds that REITs actually perform similarly to stocks, and thus are not a good inflation hedge. However, it does show that when distinguishing between expected and unexpected inflation, REITs can be partially used as an inflation hedge when inflation is expected. Thus, this is partially consistent with the findings of Rubens et al. Inflation-related bonds Another way commonly mentioned to hedge against inflation is to invest in inflation-related bonds. Here the coupons and principal are linked to current inflation. This therefore directly protects the bond against inflation. However, an inflation-linked bond does not protect against inflation in the short term. The price of an inflation-linked bond goes down when yields go up, just like a regular bond. When the consumer price index is compared with the yield of inflation-linked bonds over 1-year periods, it is apparent that there is little correlation between the metrics. So in the long run, an inflation-related bond protects against inflation, but not in the short run. Another important aspect of these bonds is that expected inflation is priced into the price of the bond. So an inflation-linked bond protects against unexpected inflation. Therefore, if actual inflation is lower than expected inflation, a negative result is achieved on an inflation-linked bond. So is it possible to hedge against inflation? It is possible to hedge against inflation, but obviously this is
A board year as External Affairs of Asset | Accounting & Finance – Thomas Mols
For Dutch, click here. Who am I? I am Thomas Mols, 22 years old and from Tilburg. A year ago I became active at Asset | Accounting & Finance in my third year of the bachelor International Business Administration. After six months of doing committee work for the Finance Expedition, I became more familiar with A&F. I participated in almost every activity, getting to know a lot of people and making great memories. Besides studying and A&F, I spent my free time in the gym and mostly among other people. Why did I choose the function external? In the third year of my bachelor’s degree, the corona measures got lessened and I felt working life was already approaching. I had the urge to get more out of my college days so I joined A&F. By joining events often, I quickly got to know the association. I always ruled out a board year because I would have to take a break from studying. After a good conversation with some of the board members, I finally saw the value of a board year and decided to apply. What interested me most was the practical work a board member does. After several years of working in theoretical subjects only, I needed a change. In addition, I was unsure of which master’s degree I wanted to pursue, and I thought it would be useful to get a better idea of the possibilities offered by different masters during the year. The external affairs position specifically attracted me the most because you have contact with many companies and can get an inside look at everything. At the same time, I believed I could learn the most with this position. What does it deliver? The most important thing is that you are one board together. Within the board, everyone has a function with delineated responsibilities, so everyone looks at situations with their own perspective and gives their input from there. Decisions are often made together. During a board year you learn to work together very well. Not only within A&F, but also together with the other Asset departments as you will engage in consultation or discussion. You will learn how to identify interests, work and perform under pressure and how to present your opinion or strategy. In addition to the role within the board and within A&F, as external affairs you have a major role towards the outside world. You translate the wishes of companies into the opportunities the association can offer. How you want to position the association as a board is translated by the external to companies and students in the contact you have on a daily basis. So during the board year you learn to communicate in a changing context. By being in contact with so many people, both students and business people, you’re bound to build a huge network. A very useful extra for the future! What do I do as an external? As winter external affairs, you start up the Financial Business Dinner and Finance Expedition committees at the beginning of your year. You make sure the committee members know what their tasks are and guide them through the rest of the year in the work they do. In addition, you are responsible for all social media channels. This means you will help shape the policies that are written by the board during the summer. In the summer, you also help write this policy. In any case, with social media you focus on increasing the reach of the channels. During the year you will occasionally help organize other events and activities. These activities ensure the development you go through in collaborating and communicating. An important task that you perform at different times during the year is doing acquisition for collaborations with companies. The challenge in this is that you have different ways of entering into a conversation. The trick is to get a grip on the interests of the other party, to understand the context and to respond appropriately. As I mentioned earlier, you are also part of a board. You sometimes take over tasks from each other and jump in where necessary. In addition to managing your own department, you form “task forces” with other directors who take on tasks together. These range from organizing Master Experience Days to coming up with new Asset Member Card deals. In organizing events and the regular tasks you have, you don’t have unlimited time. Therefore, it is important that you prioritize and work efficiently. Because of the range of tasks you have, you will learn responsibility and develop time management skills. Conclusion All in all, a board year is a great opportunity to develop yourself and gradually make some amazing memories along the way. And to top it all off you get to help build the greatest study association that Tilburg has to offer!
