The range and relevance of the work our Policy & Technical team do is well reflected in the links in this newsletter to issues such as private equity, choice in the UK audit market and fair value measurement. In each case the outcome of public debate can significantly impact treasury, risk and finance professionals – the core of the ACT’s membership. We always welcome feedback on our contributions to these debates – either to me or to John Grout, who leads our Policy & Technical work.
I referred last month to the speech that John Tiner, Chief Executive of the FSA, gave at the ACT’s Spring Paper, in which he argued the case for the FSA’s “principles based” approach to regulation. Much recent public discussion is underlining that the extent and style of UK financial regulation has contributed to the success of the City as a world centre for financial services (incidentally, a point that Sir Digby Jones emphasised in his presentation at our Edinburgh conference).
In this context it is encouraging to see that the SEC has now made a significant move in the direction of principles based regulation, with the announcement of an easing of Sarbanes Oxley with a new set of guidelines for public companies on the evaluation and assessment of internal controls – the notorious section 404. Although this change of heart in the US may well impact some of the competitive advantage currently being enjoyed by London, on balance we should welcome the new US direction of eliminating unnecessary compliance burdens and thus helping to reduce costs. Much will in practice depend on how the auditing profession interprets materiality and risk but it does sound as if reasonableness is coming to the fore – at last.
The Treasurers’ Conference in Edinburgh at the beginning of May broke the performance targets we had set for ourselves and we were delighted with the outcome. I am most grateful to all those who took part, whether as speakers, delegates, sponsors, exhibitors or of course as the ACT organising team. We take the feedback we receive very seriously and have now completed our evaluation; we will draw on this to ensure that next year’s event is even better.
The EACT is the umbrella organisation that groups together treasury associations within Europe. We meet at six monthly intervals and much of the work of the EACT so far has been focused on the Payments Directive, SEPA and the CAST initiative (achieving standardisation of information flows in the financial value chain). At the most recent EACT meeting I pressed that we also address some of the more strategic issues that can have a profound influence on the professional lives of our members across Europe.
I have proposed to the EACT that to achieve this focus – where pan-European cooperation can be effective – each country should come to the EACT meetings with a clear identification of the issues high on their members’ agendas. On behalf of the ACT it is most likely that on my list will be areas such as the impact of private equity on corporate financial policy, financial stability issues associated with debt trading and credit derivatives, and concerns over methodology changes proposed by credit rating agencies. If the EACT can isolate topics where a meaningful contribution can and should be made by organisations whose members are professionally involved in the area then we as the ACT will support such initiatives. Our experience is that this process is most effective when a small group of individuals in treasury associations collaborate and then seek wider, pan-European support for the output.
We are holding our third talkingtreasury thought leadership forum in Düsseldorf on 3 July. This is being jointly organised by the ACT and the VDT, the German treasury association. We have an excellent agenda and look forward to a strongly pan-European attendance once again following the previous events in Prague and Amsterdam. Do consider joining us in Germany.
