August 5, 2013
Shocker: Whither Primacy of Shareholders in the UK?
Probably because people have been focusing on the Royal Baby (and rightfully so – life is too short to hone in solely on the negative stuff), the following matter has not gotten much attention and it really should. In mid-June, the UK Parliamentary Commission on Banking Standards (known as the “Tyrie Commission”) issued a final report with recommendations for wholesale revisions on how large banks should be regulated in the United Kingdom. Then a couple weeks ago, Her Majesty’s Government (Chancellor Osborne and Secretary Cable) published its response to the report, which was generally favorable.
Most of the press has focused on potential criminal liability for senior officers at banks. However, one of the recommendations is:
The Government should consult on a proposal to amend the Companies Act “to remove shareholder primacy in respect of banks, requiring directors of banks to ensure financial safety and soundness of the company ahead of the interests of its members.”
The Government’s response states “Changing director’s duties in [large banks] has the merit of signaling clearly that shareholders’ interest do not overrule the long-term safety and soundness of the firm. But it may have drawbacks. The Government determines that it is appropriate to seek views on the issue.” Can you imagine the uproar in the United States if Treasury and the Fed suggested something similar?
IASB Issues Discussion Paper on the Conceptual Framework of Financial Reporting
As described in FEI’s Financial Reporting Blog and this Accountancy Age article, the IASB has issued a discussion paper on the contextual framework of financial reporting – this is the next step after IFRS. The comment period is long – ending in January 2014, which is reasonable given the wide scope of the project. If you want just a snapshot, the IASB has provided one…
Meanwhile, former SEC Chief Accountant Jim Kroeker has been named Vice Chair of the FASB board…
Transcript: “Post-Closing Claims: What Really Happens”
We have posted the transcript for the DealLawyers.com webcast: “Post-Closing Claims: What Really Happens.”
This article noting that Judge Judy is more trusted than the entire US Supreme Court gets me depressed…
– Broc Romanek