Multiple-Currency Operation: Challenges and Advantages

With more U.S. law firms serving ' or becoming ' global enterprises, many readers will need to gain new fluency in dealing with foreign currencies and exchange-rate issues. Before you immerse yourself in technical details, here's a preview of some practical issues you may encounter and some business advantages you might seek.

Special thanks are due to Wayne Schertler, CPA, my primary guide into this subject. (For supplemental ideas by other contributors, see the accompanying sidebar, below.) Schertler is the Director of Finance for Faegre & Benson LLP (http://www.faegre.com/). With about 450 attorneys, Faegre has its headquarters in Minneapolis and additional offices in Boulder, Denver, Des Moines, Frankfurt, London and Shanghai.

Getting Started

It helps to be a quick study if you suddenly get thrown into multi-currency transactions. Schertler stresses, however, that the first step is to obtain a sophisticated banking partner. Don't assume that your hometown bank can handle these services for you.

Faegre & Benson uses Wells Fargo. If you come to them with a complex issue, Schertler says, they can be very helpful. And, like many of the other large banks, they provide an online service for purchasing foreign currencies and for international currency transfers. Such Internet services have become a necessity for doing business in a global environment.

Billing for International Work

Apart from the euro now being the required currency in euro-treaty countries, most industrialized countries (and European countries in particular) have few restrictions on currency choice.

Your clients may, of course, expect to receive bills in the local currency. In some instances, moreover, local value added tax (VAT) regulations may require that billing be in the local currency.

From the standpoint of business agility, of course, it's best if your firm can give clients billing options that they will find advantageous. For example, most of Faegre's U.S. clients in England can choose to have the law firm bill either their U.S. home office in dollars or the local UK division in pounds sterling (GBP), unless the nature or location of the work dictates otherwise.

When cross-border billing entails fixing an exchange rate, precision and skill are vital. Suppose a lawyer has a '1,000 invoice and bills it to a U.S. client, fixing a 1.75 exchange rate ' while the market moves to 1.85. Obviously, the $1750 payment received from that U.S. client will not be convertible back to '1,000 at the actual current rate.

Cross-Border Transactions

Cross-border transactions are another locus of exchange rate complications. Suppose a U.S. company has an English division that it wants to sell to a Swiss company. The U.S. parent asks your firm to put the cash in a trust account and then disburse it when the transaction closes. (UK firms often provide this type of service.) Suppose further that the purchase price is defined in U.S. dollars, and the purchasing company uses GBP to buy that amount of dollars. By the time the deal actually closes, the dollars in your trust account may be worth fewer GBP. Who's on the hook for the loss? In such a case, the client may want (for example) to have its banking partner arrange a currency hedging agreement. It is important that the lawyers are aware of these factors when less sophisticated clients might not be.

When you have $10-, $20- or $30-million transactions, these numbers can get very large; so you'll certainly want to make sure the law firm itself is never responsible for the exchange loss. In all such transactions, it's vital that the parties anticipate contingencies and understand their ramifications. It's further important that these understandings be carefully documented ' especially since failure to clarify responsibility for an exchange loss could trigger a malpractice claim.

Compensating Foreign Lawyers

Like clients, lawyers in foreign countries will have definite preferences on how they wish to be paid. Typically it will be to their advantage to be paid in their local currency, although many firms nevertheless pay their overseas lawyers in USD.

Each firm needs to decide how to allocate the impact of exchange-rate changes on its foreign partner payments. Note that implementing any adjustments may require the development of special internal accounting procedures.

To maintain confidentiality in partner pay, consider using multiple accounts. Instead of paying themselves out of their local accounts, Faegre's international offices are instructed to wire any excess money to the U.S. as a one-way deposit (ie, into an account for which they lack withdrawal privileges). The firm then pays them from a separate Wells Fargo account that uses their local currency. This is an example of a function that is fulfilled by a sophisticated banking partner.

An exception to the above scenarios is China. Chinese Renminbi (yuan) generally are not made available to U.S. banks, so Faegre wires dollars to its lawyers in China. Banks in China readily accept U.S. dollars and do necessary conversions in China.

General Accounting Complications

Multi-currency operation ripples through the organization, affecting practically every area of financial accounting and reporting. Where Faegre used to produce one report, Schertler says, the accounting department now often has to produce up to three additional reports for the firm's offices in foreign countries. Similarly, analyses performed on various accounts now often have to be done in multiple currencies.

You may therefore need to hire additional staff; and some of these people are likely to be more expensive, since they have to know how to handle multiple currencies.

Banking services also get more expensive. As already noted, Faegre maintains separate Wells Fargo accounts for different currencies, eg, for GBP and euros. While having separate accounts for different currencies in the same bank entails extra service charges, it spares Faegre from many conversion charges on transfers to and from the firm.

Tax Accounting Challenges

Tax accounting difficulties due to exchange rate fluctuations can be daunting. The countries in which Faegre currently does business tax each partner's global income (or calculate tax brackets) regardless of the currency used or the country in which the account is held.

Withholding requirements also vary. Compensation considered to be sourced in the foreign country, and paid in local currency, will generally not require U.S. federal or state tax withholding, but withholding will be necessary for partner compensation drawn from your U.S.-sourced profit pool.

To remit tax withholding in U.S. dollars, you'll have to keep track of spot valuations, which may differ at every salary payment, and you'll have to account for conversion gains and losses. For tax purposes you'll want all such valuations to remain fixed ' a desire your accounting software may seem designed to frustrate.

Because withholding tables are set to be generous, some partners will later be entitled to a sizable refund ' or maybe not so sizable. Absent special arrangements with the firm, some foreign partners could lose substantial income because money withheld from earnings in early to mid-2003 has since been devalued. Worse, if the tax-refund check is made out in U.S. dollars, a partner wishing to deposit that check in a foreign country is likely to encounter both stiff fees and unfavorable exchange rates.

In response to these difficulties, a firm should consider instituting a policy to make its foreign partners whole, based on the average exchange rate of the withholdings. The firm should also consider converting income tax refund checks into each foreign lawyer's local currency.

Software Problems

With all these exchange issues, overall trial balances often won't tie up to the penny. Inquire about new versions of your accounting software that may book your exchange gains and losses more accurately than your existing system.

You may also encounter far more complex types of accounting software issues. As with banking, therefore, you'll want more than routine technical support for your accounting software. Apart from relaying your design feedback more precisely as a basis for future system enhancements, a sophisticated system representative may be able to help resolve current problems by providing software patches or procedural workarounds.

Multi-currency issues affect budgeting software as well. When you're doing budgets, you have to decide what exchange rates you'll be using for each office. Since the actual rates vary throughout the year, these exchange gains and losses become a significant factor in the budgeting process. Your financial system should allow the use of separate exchange rates for budget and actual transactions and allow for change in the exchange rates used for forecasting throughout the year.

Your budgeting software and financial reporting software may or may not interface successfully with respect to exchange rates. Both, for example, must allow planners to specify an actual rate and a budgeted rate. Otherwise, your financial reports won't support budget monitoring; eg, if the financial reporting software retrospectively applies the current exchange rate, your budget figures will become moving targets.

For Currency Cognoscenti Only: Dealing with Rate Fluctuations

If your firm has huge volumes of currency transfers, consider using hedging tactics to make transfer costs more predictable.

Also, your firm may occasionally want to consider the forward purchase of a specific foreign currency. Such an advance purchase would make economic sense if the need for a large amount of that currency is definitely predictable and you have strong reason to believe that the cost of buying that currency will increase substantially by the time it's needed. Against the potential saving in the price of the foreign currency, however, you would need to weigh both the cost of tying up a large amount of cash and the harder-to-quantify risk of your rate forecast proving dyslexic.

Levels of Competitive Advantage

It goes almost without saying that fluent multi-currency capabilities in transactional work, billing-collection, compensation and tax administration all boost a firm's competitiveness in the global market for legal services. Even if the multi-currency component of a client's work is small, the client may find it efficient to do all its work with a firm that can also take care of this international fraction.

Finally, bear in mind that multi-currency capabilities are only the first stage ' the “table stakes” if you will ' in competing for international legal work. For a more powerful competitive advantage, your firm should aim to become well established and well connected in specific foreign countries.

Schertler cites Faegre & Benson's China partners as an example. There are two forms of doing business in China. At the basic “representative office” level, a U.S.-based law firm is not allowed to work for or render a bill directly to Chinese companies. Faegre has gone through the process to obtain approval for the second level, however. The firm can now bill in the local currency and also deal directly with local taxation authorities.

Sidebar: More Foreign Currency Tips

Not surprisingly, A&FP reviewers of the accompanying foreign currency article have some ideas of their own to share.

Reviewing the article prompted the following interesting observations and comparisons by Liz Kovach, acting CFO of Orrick, Herrington & Sutcliffe LLP.

Kovach writes from the unique perspective of the Orrick Global Operations Center in West Virginia. Our January 2004 edition described how the GOC provides 24/7 back-office support to the firm's U.S. and foreign offices. Orrick's ongoing planned growth includes an active international strategy ' Paris, Rome and Milan offices were added within the last 2 years.

Efficiency in international funding transfers. Although we at Orrick use the Internet to initiate funding transfers, we're continuing to seek automation of routine transfers. Apart from the added expense of daily balance checking and intervention, manual initiation of routine transfers is a concern because (as the article points out) not every accounting staffer has the knowledge to handle international transactions. We are interested in exploring sweep accounts that can automatically repatriate excess funds from foreign offices to maintain certain base funding levels in our international accounts (within predefined exchange rate parameters). We have this capability in the U.S., and getting banks to introduce similar international sweep-account capabilities will presumably get easier as our fund transfer volumes continue to grow.

Leveraging local knowledge and talent. While the GOC handles all U.S. billing, trained on-site users of our standard CMS accounting system do all the billing for our foreign offices. Foreign language proficiency is the main reason for that practice.

Reporting and taxation differences in foreign offices. One of the trickier challenges in global operations is keeping track of all the different reporting requirements and tax rules. While we get good guidance on this from PWC, we also tap the knowledge of our foreign lawyers and their local accountants.

In London, for example, we must use the accrual method rather than our cash-based method. Moreover, the UK accrual method follows somewhat different rules than in the U.S.; eg, WIP would be considered accrual-basis revenue here, but London WIP is not considered revenue until it is billed.

Paris, on the other hand, does use cash-basis accounting, but French tax rules differ significantly from those of the IRS, eg, regarding deductions for depreciation.

Billing of foreign clients. Generally we bill foreign clients in their native currency, and they pay us in that currency. Whether exchange-rate changes between billing and payment generate a realized gain (loss) on our P&L statement depends on whether we repatriate the funds. Of course, we evaluate any repatriation loss against the cost of not repatriating the money ' since repatriated funds can, for example, be used to pay down lines of credit.

Insulating foreign partners from exchange rate fluctuations. Orrick tries to insulate its foreign partners from fluctuations. We do it on the basis of a 5-year average exchange rate. To date, it turns out that average has worked to the advantage of our foreign partners.

Another reviewer was our Board member Pete Peterson, Managing Director of the Law Firm Business Institute ([email protected]). Peterson, whose extensive law firm experience included a stint in Belgium, offers these supplementary tips:

If your firm lacks enough volume to justify currency-hedging contracts. Try where possible (and where competitive pressures permit) to establish higher foreign currency billing rates in anticipation of currency fluctuations. This is called internal hedging.

When billing from the United States. Bill foreign offices of U.S.-based companies in US dollars whenever possible. Some foreign corporations are also agreeable to USD billing.

Another way to minimize exposure to exchange rate volatility. To the extent possible, simply match foreign currency cash inflows to foreign currency cash outflows; eg, aim to balance a branch office's foreign-currency expenses against the revenue generated in that currency.

Compensation flexibility. Depending on the citizenship and work location of your firm's partners, and depending on various income tax filing requirements, you may want to establish multiple-currency compensation arrangements. Partners may then choose to be compensated partly in their native currency and partly in USD, in order to accommodate their respective income tax obligations. Such partners may also want to set up individual U.S. bank accounts (as will some associates), in part to minimize rate exposure from income tax payments and refunds.

Currency conversion by general accounting systems. It's important for systems to automatically convert multi-currency input into single-currency reports. This is particularly helpful in communicating firm-wide results to foreign partners, who are accustomed to reviewing financial information in their local currency.

Simplifying budget reporting reviews. To allow for easier reviews of financial statements following each month-end conversion process, some firms establish a set currency rate for the year. (If you try this approach, you may want to decide in advance what amount of rate fluctuation would trigger a recalculation. The accompanying article discusses the importance of being able to use variable exchange rates if volatility is a problem.)

With more U.S. law firms serving ' or becoming ' global enterprises, many readers will need to gain new fluency in dealing with foreign currencies and exchange-rate issues. Before you immerse yourself in technical details, here's a preview of some practical issues you may encounter and some business advantages you might seek.

Special thanks are due to Wayne Schertler, CPA, my primary guide into this subject. (For supplemental ideas by other contributors, see the accompanying sidebar, below.) Schertler is the Director of Finance for Faegre & Benson LLP (http://www.faegre.com/). With about 450 attorneys, Faegre has its headquarters in Minneapolis and additional offices in Boulder, Denver, Des Moines, Frankfurt, London and Shanghai.

Getting Started

It helps to be a quick study if you suddenly get thrown into multi-currency transactions. Schertler stresses, however, that the first step is to obtain a sophisticated banking partner. Don't assume that your hometown bank can handle these services for you.

Faegre & Benson uses Wells Fargo. If you come to them with a complex issue, Schertler says, they can be very helpful. And, like many of the other large banks, they provide an online service for purchasing foreign currencies and for international currency transfers. Such Internet services have become a necessity for doing business in a global environment.

Billing for International Work

Apart from the euro now being the required currency in euro-treaty countries, most industrialized countries (and European countries in particular) have few restrictions on currency choice.

Your clients may, of course, expect to receive bills in the local currency. In some instances, moreover, local value added tax (VAT) regulations may require that billing be in the local currency.

From the standpoint of business agility, of course, it's best if your firm can give clients billing options that they will find advantageous. For example, most of Faegre's U.S. clients in England can choose to have the law firm bill either their U.S. home office in dollars or the local UK division in pounds sterling (GBP), unless the nature or location of the work dictates otherwise.

When cross-border billing entails fixing an exchange rate, precision and skill are vital. Suppose a lawyer has a '1,000 invoice and bills it to a U.S. client, fixing a 1.75 exchange rate ' while the market moves to 1.85. Obviously, the $1750 payment received from that U.S. client will not be convertible back to '1,000 at the actual current rate.

Cross-Border Transactions

Cross-border transactions are another locus of exchange rate complications. Suppose a U.S. company has an English division that it wants to sell to a Swiss company. The U.S. parent asks your firm to put the cash in a trust account and then disburse it when the transaction closes. (UK firms often provide this type of service.) Suppose further that the purchase price is defined in U.S. dollars, and the purchasing company uses GBP to buy that amount of dollars. By the time the deal actually closes, the dollars in your trust account may be worth fewer GBP. Who's on the hook for the loss? In such a case, the client may want (for example) to have its banking partner arrange a currency hedging agreement. It is important that the lawyers are aware of these factors when less sophisticated clients might not be.

When you have $10-, $20- or $30-million transactions, these numbers can get very large; so you'll certainly want to make sure the law firm itself is never responsible for the exchange loss. In all such transactions, it's vital that the parties anticipate contingencies and understand their ramifications. It's further important that these understandings be carefully documented ' especially since failure to clarify responsibility for an exchange loss could trigger a malpractice claim.

Compensating Foreign Lawyers

Like clients, lawyers in foreign countries will have definite preferences on how they wish to be paid. Typically it will be to their advantage to be paid in their local currency, although many firms nevertheless pay their overseas lawyers in USD.

Each firm needs to decide how to allocate the impact of exchange-rate changes on its foreign partner payments. Note that implementing any adjustments may require the development of special internal accounting procedures.

To maintain confidentiality in partner pay, consider using multiple accounts. Instead of paying themselves out of their local accounts, Faegre's international offices are instructed to wire any excess money to the U.S. as a one-way deposit (ie, into an account for which they lack withdrawal privileges). The firm then pays them from a separate Wells Fargo account that uses their local currency. This is an example of a function that is fulfilled by a sophisticated banking partner.

An exception to the above scenarios is China. Chinese Renminbi (yuan) generally are not made available to U.S. banks, so Faegre wires dollars to its lawyers in China. Banks in China readily accept U.S. dollars and do necessary conversions in China.

General Accounting Complications

Multi-currency operation ripples through the organization, affecting practically every area of financial accounting and reporting. Where Faegre used to produce one report, Schertler says, the accounting department now often has to produce up to three additional reports for the firm's offices in foreign countries. Similarly, analyses performed on various accounts now often have to be done in multiple currencies.

You may therefore need to hire additional staff; and some of these people are likely to be more expensive, since they have to know how to handle multiple currencies.

Banking services also get more expensive. As already noted, Faegre maintains separate Wells Fargo accounts for different currencies, eg, for GBP and euros. While having separate accounts for different currencies in the same bank entails extra service charges, it spares Faegre from many conversion charges on transfers to and from the firm.

Tax Accounting Challenges

Tax accounting difficulties due to exchange rate fluctuations can be daunting. The countries in which Faegre currently does business tax each partner's global income (or calculate tax brackets) regardless of the currency used or the country in which the account is held.

Withholding requirements also vary. Compensation considered to be sourced in the foreign country, and paid in local currency, will generally not require U.S. federal or state tax withholding, but withholding will be necessary for partner compensation drawn from your U.S.-sourced profit pool.

To remit tax withholding in U.S. dollars, you'll have to keep track of spot valuations, which may differ at every salary payment, and you'll have to account for conversion gains and losses. For tax purposes you'll want all such valuations to remain fixed ' a desire your accounting software may seem designed to frustrate.

Because withholding tables are set to be generous, some partners will later be entitled to a sizable refund ' or maybe not so sizable. Absent special arrangements with the firm, some foreign partners could lose substantial income because money withheld from earnings in early to mid-2003 has since been devalued. Worse, if the tax-refund check is made out in U.S. dollars, a partner wishing to deposit that check in a foreign country is likely to encounter both stiff fees and unfavorable exchange rates.

In response to these difficulties, a firm should consider instituting a policy to make its foreign partners whole, based on the average exchange rate of the withholdings. The firm should also consider converting income tax refund checks into each foreign lawyer's local currency.

Software Problems

With all these exchange issues, overall trial balances often won't tie up to the penny. Inquire about new versions of your accounting software that may book your exchange gains and losses more accurately than your existing system.

You may also encounter far more complex types of accounting software issues. As with banking, therefore, you'll want more than routine technical support for your accounting software. Apart from relaying your design feedback more precisely as a basis for future system enhancements, a sophisticated system representative may be able to help resolve current problems by providing software patches or procedural workarounds.

Multi-currency issues affect budgeting software as well. When you're doing budgets, you have to decide what exchange rates you'll be using for each office. Since the actual rates vary throughout the year, these exchange gains and losses become a significant factor in the budgeting process. Your financial system should allow the use of separate exchange rates for budget and actual transactions and allow for change in the exchange rates used for forecasting throughout the year.

Your budgeting software and financial reporting software may or may not interface successfully with respect to exchange rates. Both, for example, must allow planners to specify an actual rate and a budgeted rate. Otherwise, your financial reports won't support budget monitoring; eg, if the financial reporting software retrospectively applies the current exchange rate, your budget figures will become moving targets.

For Currency Cognoscenti Only: Dealing with Rate Fluctuations

If your firm has huge volumes of currency transfers, consider using hedging tactics to make transfer costs more predictable.

Also, your firm may occasionally want to consider the forward purchase of a specific foreign currency. Such an advance purchase would make economic sense if the need for a large amount of that currency is definitely predictable and you have strong reason to believe that the cost of buying that currency will increase substantially by the time it's needed. Against the potential saving in the price of the foreign currency, however, you would need to weigh both the cost of tying up a large amount of cash and the harder-to-quantify risk of your rate forecast proving dyslexic.

Levels of Competitive Advantage

It goes almost without saying that fluent multi-currency capabilities in transactional work, billing-collection, compensation and tax administration all boost a firm's competitiveness in the global market for legal services. Even if the multi-currency component of a client's work is small, the client may find it efficient to do all its work with a firm that can also take care of this international fraction.

Finally, bear in mind that multi-currency capabilities are only the first stage ' the “table stakes” if you will ' in competing for international legal work. For a more powerful competitive advantage, your firm should aim to become well established and well connected in specific foreign countries.

Schertler cites Faegre & Benson's China partners as an example. There are two forms of doing business in China. At the basic “representative office” level, a U.S.-based law firm is not allowed to work for or render a bill directly to Chinese companies. Faegre has gone through the process to obtain approval for the second level, however. The firm can now bill in the local currency and also deal directly with local taxation authorities.

Sidebar: More Foreign Currency Tips

Not surprisingly, A&FP reviewers of the accompanying foreign currency article have some ideas of their own to share.

Reviewing the article prompted the following interesting observations and comparisons by Liz Kovach, acting CFO of Orrick, Herrington & Sutcliffe LLP.

Kovach writes from the unique perspective of the Orrick Global Operations Center in West Virginia. Our January 2004 edition described how the GOC provides 24/7 back-office support to the firm's U.S. and foreign offices. Orrick's ongoing planned growth includes an active international strategy ' Paris, Rome and Milan offices were added within the last 2 years.

Efficiency in international funding transfers. Although we at Orrick use the Internet to initiate funding transfers, we're continuing to seek automation of routine transfers. Apart from the added expense of daily balance checking and intervention, manual initiation of routine transfers is a concern because (as the article points out) not every accounting staffer has the knowledge to handle international transactions. We are interested in exploring sweep accounts that can automatically repatriate excess funds from foreign offices to maintain certain base funding levels in our international accounts (within predefined exchange rate parameters). We have this capability in the U.S., and getting banks to introduce similar international sweep-account capabilities will presumably get easier as our fund transfer volumes continue to grow.

Leveraging local knowledge and talent. While the GOC handles all U.S. billing, trained on-site users of our standard CMS accounting system do all the billing for our foreign offices. Foreign language proficiency is the main reason for that practice.

Reporting and taxation differences in foreign offices. One of the trickier challenges in global operations is keeping track of all the different reporting requirements and tax rules. While we get good guidance on this from PWC, we also tap the knowledge of our foreign lawyers and their local accountants.

In London, for example, we must use the accrual method rather than our cash-based method. Moreover, the UK accrual method follows somewhat different rules than in the U.S.; eg, WIP would be considered accrual-basis revenue here, but London WIP is not considered revenue until it is billed.

Paris, on the other hand, does use cash-basis accounting, but French tax rules differ significantly from those of the IRS, eg, regarding deductions for depreciation.

Billing of foreign clients. Generally we bill foreign clients in their native currency, and they pay us in that currency. Whether exchange-rate changes between billing and payment generate a realized gain (loss) on our P&L statement depends on whether we repatriate the funds. Of course, we evaluate any repatriation loss against the cost of not repatriating the money ' since repatriated funds can, for example, be used to pay down lines of credit.

Insulating foreign partners from exchange rate fluctuations. Orrick tries to insulate its foreign partners from fluctuations. We do it on the basis of a 5-year average exchange rate. To date, it turns out that average has worked to the advantage of our foreign partners.

Another reviewer was our Board member Pete Peterson, Managing Director of the Law Firm Business Institute ([email protected]). Peterson, whose extensive law firm experience included a stint in Belgium, offers these supplementary tips:

If your firm lacks enough volume to justify currency-hedging contracts. Try where possible (and where competitive pressures permit) to establish higher foreign currency billing rates in anticipation of currency fluctuations. This is called internal hedging.

When billing from the United States. Bill foreign offices of U.S.-based companies in US dollars whenever possible. Some foreign corporations are also agreeable to USD billing.

Another way to minimize exposure to exchange rate volatility. To the extent possible, simply match foreign currency cash inflows to foreign currency cash outflows; eg, aim to balance a branch office's foreign-currency expenses against the revenue generated in that currency.

Compensation flexibility. Depending on the citizenship and work location of your firm's partners, and depending on various income tax filing requirements, you may want to establish multiple-currency compensation arrangements. Partners may then choose to be compensated partly in their native currency and partly in USD, in order to accommodate their respective income tax obligations. Such partners may also want to set up individual U.S. bank accounts (as will some associates), in part to minimize rate exposure from income tax payments and refunds.

Currency conversion by general accounting systems. It's important for systems to automatically convert multi-currency input into single-currency reports. This is particularly helpful in communicating firm-wide results to foreign partners, who are accustomed to reviewing financial information in their local currency.

Simplifying budget reporting reviews. To allow for easier reviews of financial statements following each month-end conversion process, some firms establish a set currency rate for the year. (If you try this approach, you may want to decide in advance what amount of rate fluctuation would trigger a recalculation. The accompanying article discusses the importance of being able to use variable exchange rates if volatility is a problem.)