Look out for the American experience with XBRL introduction; how a CFO scrapped traditional budgets; and disciplinary hearings.
Investment managers turn to the Asia-Pacific region
A fall in returns in many mature investment markets is leading to greater attention on the Asia-Pacific region, where the long-term outlook is bright, says a new report from KPMG Singapore.
The report, State of the Investment Management Industry in Asia Pacific, predicts much of this attention is likely to come from the investment management industry, specifically the currently under-developed investment management services area. The investment management industry is made up of entities that are actively engaged in the management of pooled assets.
KPMG says the industry needs to consider how to respond to challenges, including: rising levels of wealth among the middle class; previously closed markets being opened by regulatory reforms; market polarisation; attracting and retaining key staff; and culture and language diversity.
Singapore VAT rated highly in global comparison
Singapore has been ranked equal fourth most friendly country in the world to do business in from a value-added tax (VAT) perspective, according to a worldwide survey by KPMG International. Hong Kong and China ranked equal seventh, while Australia was equal eighth. The UK was the most VAT-friendly, with 10 per cent of the sample saying it was 'easy'. Italy was cited as the most difficult.
The survey canvassed senior finance professionals at 500 large corporations in 22 countries. It found three-quarters of major global businesses believe governments will rely more on indirect taxes in the future.
Half rated errors in GST/VAT compliance as the top global tax risk for their organisation, significantly ahead of corporate tax risks (38 per cent), while 82 per cent prepared to give an estimate said their total annual VAT throughput was between US$200 million and US$1 billion.
Insurance industry in Hong Kong put under microscope
Hong Kongs Office of the Commissioner of Insurance says it will enhance its monitoring of risk concentration and pricing behaviour, under the expectation that ongoing market volatility will induce stress on insurers whose operating profit is derived largely from investment income.
Commissioner of insurance Clement Cheung says insurers should strike a sensible balance between business expansion and capacity building when charting their corporate strategies. They should also enhance manpower training and the interface between frontline and back-office personnel.
There were a total of 178 authorised insurers, 55,440 appointed insurance agents and 7060 authorised brokers operating in Hong Kong last year.
Government finance skills fail to thrill
Those who think government finance departments arent performing have had their suspicions justified. According to a new Deloitte study, Mastering finance in government: transforming the government enterprise through better financial management, 48 per cent of public officials from around the world believe their organisations lack adequate financial management capabilities. Despite progress in streamlining transactional efficiency over the past decade, significant financial management constraints continue to face governments.
'In the past, government finance has often been relegated to back-office compliance activities,' says Greg Pellegrino, global public sector industry leader Deloitte Touche Tohmatsu. 'However, the emergence of lessons learned from the post-Enron financial regulatory movement and other challenges like proliferating legal requirements, scarce resources, human resource outflows, and poor internal control structures are forcing government leaders to move finance to the forefront of their transformation agendas.'
The study, which looks at the finance function of more than 200 government departments from 28 countries, identifies inadequate risk management as one of many challenges finance officials face. However, there is reason for optimism.
'Government leaders can improve the way programs function by beefing up the finance function within their organisations,' says Pellegrino. 'There is evidence that progress is being made, and we have found models around the globe that can be replicated successfully. There is a huge gap, but there are also governments showing the way to finance mastery.'
