Financial reporting 'vital for growth'
Manama, March 21, 2013
Financial reporting and analysis is a cornerstone to improving company performance and investor relations, a senior government official said yesterday at a meeting of the Bahrain Accountants Association.
Industry and Commerce Minister Dr Hassan Fakhro said these were components, which could contribute significantly to improving the investment climate in the country, and also help in attracting new investors, reported our sister newspaper the Gulf Daily News.
The meeting featured a workshop titled 'Accounts Reporting and Financial Analysis - As a Culture of Foreign Institutions', which was described by Dr Fakhro as a timely act, "coming as it does at a point when the world is recovering from the global financial crisis, and at a time when regulators are better placed to plan a way forward to prevent similar catastrophes recurring in the future".
"There is always a danger, I feel, in taking immediate regulatory action to deal with an issue before the full potential impact of a problem, and for that matter the fix, is properly understood.
"Sarbanes Oxley is a case in point, which may well have served an immediate requirement, but created enormous confusion and compliance problems and cost to corporate America, and as one writer put it left mid-sized and small companies "stuck like deer in the headlights," the minister said.
"Bahrain has, throughout this time, remained stable and relatively unscathed, and I believe this is due in no small measure to the conservative regulatory regime which is a characteristic of the commercial and financial climate in the kingdom, and which includes a strong corporate governance element.
"Successfully navigating through difficult and turbulent times requires not only a strong hand at the helm, it also requires to have all hands on deck.
"It is not sufficient merely for regulators to be on top of any new emerging issues, it requires everyone involved to be responsible, from employees to shareholders, creditors to lenders.
"We cannot rely entirely on regulation, to a greater extent it is down to individual and corporate responsibility, and this is largely down to transparency in reporting and analysis, which I believe workshops such as this, and the activities of organisations like the BAA, play an important role," Dr Fakhro said.
According to him the culture of reporting and analysis was the product "first of strong regulatory regimes, but which has also been driven by investors, particularly institutional investors, who have demanded transparency in all respects with regard to their investments".
BAA president Abbas Al Radhi, who also addressed the gathering, said being a public accountant wasn't just about number crunching.
"Our clients today demand us to act as strategic business advisers in an ever-changing world. Our responsibility is to maintain the skills and techniques to act as a modern business adviser and to relish the opportunity to help our clients meet new challenges,” he said. – TradeArabia News Service